January 2, 2019 / 7:33 AM / 9 months ago

Energean to supply Israeli power provider IPM with natural gas

TEL AVIV, Jan 2 (Reuters) - Energean Oil and Gas said on Wednesday it has signed an agreement to supply 5.5 billion cubic meters (BCM) of gas from its Karish and Tanin fields over 19 years to I.P.M. Beer Tuvia.

The contract is contingent on results of the 2019 drilling programme, which includes the drilling of four wells in Israel.

Energean estimates the agreement will contribute $900 million in revenue over the life of the contract.

Energean has now signed gas supply agreements for 4.6 BCM annually from Karish and Tanin, which are being built with a total capacity of 8 BCM a year. Energean targets filling the remaining capacity in the medium term.

IPM is an independent power producer that will supply the national grid and large private consumers. It is building a plant that is due to start operating in the second half of 2020.

The Karish and Tanin development remains on track for first gas in the first quarter of 2021.

“Our future sales contracts will target both the growing domestic and regional export markets,” said Energean Chief Executive Mathios Rigas. (Reporting by Tova Cohen, Editing by Ari Rabinovitch)

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